“I would rather be in Florida than any other state in the country right now, and I think a lot of people would agree with me,” said Dr. Jerry D. Parrish, the current Chief Economist and Director of Research at the Florida Chamber Foundation.
Parrish spoke with The Capitolist to go over the latest numbers released in the Florida Chamber’s Florida Scorecard, which provides Florida leaders and local stakeholders with metrics that measure progress within their communities. It provides hundreds of data points, including unemployment figures, tax rates, high school graduation rates, etc.
Parrish said that if Florida was an independent country it would have the 17th largest economy in the world and he expects it to move to the tenth largest by 2030.
He said despite the pandemic, Florida has emerged much stronger than other states, economically.
In the last few months, Florida Governor Ron DeSantis has come under fire for his “rosy economic outlook.” However, the Florida Scorecard numbers seem to support the governor’s optimism.
“Florida is a much better position than most states,” he said. “In Florida, we’ve regained all our Gross Domestic Product (GDP) that we had before before COVID hit. When we got the third quarter numbers, we were already almost back to 100 percent.”
But the GDP only represents manufacturing. He said additionally, housing sales are up, poverty rates are down, high school graduation and grade reading scores are up, and jobs in Florida are a real bright spot.
“I don’t see any red flags especially as I compare it to other states,” he said.
On the jobs front, Florida has recovered more than the 700,000 jobs lost in Florida due to pandemic.
“Our unemployment rate now is 4.7 percent and improving,” Parrish said, “Last time I looked California and New York were holding in the eight and nine percent range.”
He said Florida actually has more high-wage jobs than before COVID and that’s been true since June of last year.
“We certainly led the country on that and it continues to be the fact of when you separate the numbers by the types of jobs,” he said, “and, as far as wages, Florida is substantially better off than the rest of the U.S.”
The Leisure and Hospitality industry is the one area where job loss is still significant.
“We’ve had some job losses. However, the majority or almost half of them have been in Leisure and hospitality, and certainly it’s been in the areas that are most dependent on visitors from other states and other countries,” he said.
“What we need back is our visitors.” He explained that while visitors who can drive to Florida are returning, international traffic is still at almost zero.
According to Parrish, Florida had a 131.4 million visitors from all over — from other states and other countries — in 2019. But during the pandemic, international and Canadian visitation was down more than 90 percent.
“Those International visitors stay longer and spend more and are worth about $6 billion plus in state tax revenue and about $5.3 billion plus in local tax revenue. (International travelers) won’t all be back by this time next year, but within two years from now, I believe that we’ll be back to 100 percent of where we were before COVID and it’ll take that for all the Leisure and Hospitality folks to go back to work,” Parrish said.
But while visitors haven’t all returned, Florida is seeing an influx of American’s moving to the Sunshine State from states that have been a lot more gloomy lately.
“Every hour of every single day, there’s 1.19 million dollars worth of adjusted gross income moving into Florida — that’s every single hour of every single day,” Parrish reiterated.
He said prior to the pandemic, about 900 net new people a day moved to Florida, in search of good jobs, lower taxes and a better quality of life. That number dropped during the pandemic but he expects it to rebound to 800 net new people a day this year and return to pre-pandemic numbers soon thereafter.
However, more people moving to Florida comes at a cost. Those people are buying homes, driving up home and construction prices and making affordable housing more scarce.
“I’ve given a lot of presentations lately on commercial real estate which includes multi-family homes and I look at three things. I look at land. I look at labor and I look at lumber prices. Lumber is near all-time highs,” Parrish explained.
He said that during COVID a lot of the lumber mills shut down, not knowing what would happen. At the same time, people were at home wanting to add an extra room on to their homes for office space or wanting to renovate. On top of that, you add on all the people moving to Florida, building new homes and Florida ended up with a lumber supply problem. Lumber prices tripled.
Lot prices increased and labor costs soared too, because everybody in the construction industry was working. It became virtually impossible to build low cost homes in that environment.
But, these kinds of problems often arise in a booming economy, and according to Parrish, that’s not a bad place for Florida to find itself after the challenges of the last year.